Bermuda-based Ariel Holdings, Ltd. announced it will acquire a Lloyd's syndicate manager.
Ariel said it will acquire London-based Atrium Underwriting Plc, a publicly traded company that manages Lloyd's Syndicates 570 and 609.
A.M. Best Co. placed the financial strength and credit ratings of both the Ariel holding company and reinsurance subsidiary under review with negative implications after Friday's acquisition announcement.
The placing of Ariel's ratings under review is based on the technical aspects of the financing, with regards to the acquisition, which needs to meet A.M. Best's guidelines and criteria, the Oldwick, N.J.-based rating firm said.
Aside from the financing arrangements, A.M. Best said it views the transaction positively.
The agency noted that the benefits of the proposed transaction are that syndicates 570 and 609 are strong performers and would bring a seasoned and more diverse book of business in addition to broader market access to Ariel.
Furthermore, this acquisition, Best said, will enhance Ariel's market profile.
The ratings of Ariel will remain under review pending A.M. Best's review of the transaction, which includes the financing, integration plan and its risk-adjusted capital position upon completion of the deal, which is subject to regulatory approval.
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